Professional Documents
Culture Documents
TLE 10 Notes
TLE 10 Notes
T-Account
-The simplest representation of account
-Called a T-Account because the border splitting the title of the account and
the debit and credit size is in the form of an uppercase “T”
-The top part is where you write the title of the account
-The bottom part is split into 2 sides, the Debit Side (Left Side) and the
Credit Side (Right Side)
Account
-The device used to summarize changes in the elements of accounting
-It is a detailed record of the increases, decreases, and the balance of each
element that appears in an entity’s financial statement
Asset (+ , -)
-When asset increases, write the increase in the debit side
-When asset decreases, write the decrease in the credit side
Liability (- , +)
-When liability increase, write the increase in the credit side
-When liability decrease, write the decrease in the debit side
Proprietorship (- , +)
-When proprietorship increase, write the increase in the credit side
-When proprietorship decrease, write the decrease in the debit side
Income (- , +)
-When income increase, write the increase in the credit side
-When income decrease, write the decrease in the debit side
Expenses (+ , -)
-When expenses increase, write the increase in the debit side
-When expenses decrease, write the decrease in the credit side
Drawing / Withdrawal (+ , -)
-When drawing / withdrawal increase, write the increase in the debit side
-When drawing / withdrawal decrease, write the decrease in the credit side
Sample Problem
Transactions:
Sept. 1, 2021 Mr. Cruz opened a repair shop by investing cash of
P 80,000
3 Received cash of P 2,000 for services rendered
10 Computers and calculators were purchased from Well-Off
Marketing, P 35,000 paying P 5,000 cash as down
payment and balance on account
28 The balance due to Well-Off Marketing was paid in cash
Journalizing
Accounting Cycle
-A collective process of identifying, analyzing, and recording the accounting
events of a company
-A standard 8-step process that begins when a transaction occurs and ends
with its inclusion in the financial statement
-This procedure must be repeated continuously to enable the business to
prepare new up-to-date financial statements at reasonable intervals
Steps:
1. Journalizing
2. Posting
3. Preparing the Trial Balance
4. Preparing the Worksheet
5. Preparing the Financial Statement
6. Closing the Books
7. Preparing the Post Closing Trial Balance
8. Reversing certain entries
Journalizing
-A systematic recording of business transaction in a journal. The first step in
the accounting cycle as transactions are recorded for the first time in
chronological order
Journal
-A chronological record of the entity’s transactions.
-Considered as “The Book of Original Entry” and also considered as the
“Diary of a Business” because it is here where the transactions of the
business are first recorded in chronological order
-Journals vary depending in kinds and forms depending upon the size and
nature of the business operation
Journal Entry
-Entry of a transaction or an event in the journal. It shows all the effects of
business transactions in terms of debits and credits
*General Journal
-Simplest form of journal